AGENDA MEMORANDUM

 

 

Meeting Date:           July 27, 2009

 

From:                          Jerry Boop, Finance Director, CPA, CGFO

 

Subject:                      Resolution authorizing the City Manager to execute and submit the Certification of Taxable Value for Fiscal Year 2009-10 to the Lake County Property Appraiser

 

 

Staff Recommendation:

Staff recommends authorizing the City Manager to execute and submit the Certification of Taxable Value for Fiscal Year 2009-10 to the Lake County Property Appraiser, establishing the tentative operating millage rate at 4.3179 mills. 

 

Analysis:

Under current TRIM guidelines, (s. 200.065 F.S.), the maximum millage rate that may be adopted by a majority vote is 4.8441 mills which is not considered a tax increase.  Once established, the tentative operating millage rate may be decreased at final adoption but it cannot be increased. The 2009-10 proposed budget reflects the prior year operating millage rate of 4.3179 mills.

 

 

The City has been impacted by significant declines in property values as reflected in the table below: 

 

 

 

 

Current Value

Prior Year Value

Decrease in Values

Percent

Change

*Impact on Revenue

General Fund

$  734,309,277

$   793,820,158

  ($59,510,881)

(7.50%)

($275,474)

GLCRA

    148,349,729

   156,359,311

(8,009,582)

(5.12%)

(33,448)

CHCRA

      88,325,303

    96,516,781

(8,191,478)

(8.49%)

(35,272)

27/441 CRA

    455,828,026

483,676,118

(27,848,092)

(5.76%)

(116,779)

Total

$1,426,812,335

$1,530,372,368

($103,560,033)

(6.77%)

($460,793)

 

*Updated to reflect most recent valuations

 

The effect of decreasing property values on Ad valorem revenues reflected in the table below clearly illustrates a disproportionate share among taxing districts of the decline. The rollback rate by its design should be revenue neutral, but it cannot be as the decline was not linear or evenly distributed across the districts.

 

 

 

 

 

 

Fiscal Year 2008-09 Revenue 4.3179 Mills

 

 

 

*Projected 2009-10 Revenue 4.3179 Mills

 

 

 

Projected

2009-10 Revenue Rollback Rate 4.726 Mills

 

 

Projected

2009-10 Revenue Rollback with 2.5 % Inflation Adder 4.8441 Mills

General Fund

$5,326,283

$5,050,809

$5,528,177

$5,666,324

GLCRA

286,099

252,651

276,531

283,440

CHCRA

159,747

124,475

136,240

139,645

27/441 CRA

541,635

424,856

465,011

476,632

Total

$6,313,764

$5,852,791

$6,405,959

$6,566,041

 

*Updated to reflect most recent valuations.

 

In the 2009-10 tax year, a municipality may levy a maximum millage rate determined as follows:

 

(a)    Millage rate of 4.3179.

 

                        Current year revenue at 4.3179 mills                             $5,852,791

                        ($1,426,812,335 X .0043179 = $6,160,832  X 95% = $5,852,791)              

 

 

(b)   The maximum millage rate that may be levied by majority vote shall be the rolled back rate calculated pursuant to s. 200.065 and adjusted for growth in per capita Florida personal income.

 

 

Rolled back Millage Rate before Inflation

rate of 2.5%                                                                 4.7260

 

Adjustment for growth in per capita Florida

Income                                                                                    1.0250%

Majority vote maximum millage rate allowed              4.8441

 

                        Current year revenue at 4.8441 mills                      6,566,041

                        ($1,426,812,335 X .004844 = $6,911,621 X 95% $6,566,041)                     

 

 

(c)    A rate of not more than 110 percent of the rate in paragraph (a) may be levied if approved by a two-thirds vote of the governing body. 

 

Rolled back  Millage Rate before                                 4.8441

Maximum percentage                                                  110.00%

                        Two-thirds vote maximum                                          5.3286

 

                        Current year revenue at 5.3286 mills                             7,222,767

                        ($1,426,812,335 X .0053286 = $7,602,912 X 95% =$7,222,767)                

 

 

(d)   A rate in excess of the millage rate allowed in paragraph (b) may be levied if approved by a unanimous vote of the governing body or by a three-fourths vote if the governing body has nine or more members or if approved by a referendum of the voters.

 

(e)    Any such rate that does not exceed the majority vote maximum millage rate allowed of 4.8441.

 

A municipality that is in violation of this section shall forfeit the distribution of the local government half-cent sales tax revenues during the 12 months following a determination of non-compliance by the Department of Revenue subject to the conditions provided in ss. 200.065 and 218.63.  The Department of Revenue has reviewed and approved the forms and all calculations provided to you by your Finance Staff.

 

The City of Leesburg has four options available for adoption:

 

  1. By a majority vote the Commission may adopt a maximum millage rate equal to the current year rolled back rate adjusted by compound annual growth factors of 4.8441 mills generating revenue of $6,566,041

 

  1. By a two-thirds vote of the governing body the Commission may adopt a maximum millage rate up to 5.3286 mills or $7,222,767

 

  1. Any such rate that does not exceed the majority vote maximum millage rate allowed of 4.8441.

 

  1. By unanimous vote a rate greater than 5.3286 mills but not to exceed nine (9) mills

 

 

Under State Law, the Commission is required to notify the property appraiser of a proposed millage rate before completion of the budget process. This proposed rate may be reduced, but may not be increased by subsequent action of the Commission.

 

The attached forms must be filed with Lake County no later than Tuesday, August 4, 2009. By signature of the City Manager, the City will notify the property appraiser of the following:

 

·         The Certification of Taxable Value reflecting the majority vote maximum millage rate allowed of 4.3179 mills per $1,000 for 2009-10

 

·         The Tax Increment Adjustment Worksheet for the Greater Leesburg, Carver Heights and Highway 27/441 CRA’s for  2009-10

 

·         The Maximum Millage Levy Calculation Preliminary Disclosure reflecting the calculation for the current year proposed operating millage rate of 4.3179

 

The public hearing to consider the current year proposed operating millage rate and tentative budgets is scheduled for Thursday, September 10, 2009 at 5:05 p.m. in the Commission Room.

 

The draft budget submitted to the commission currently reflects the prior year millage rate of 4.3179 mills.  In order to allow for margin and the possibility of deficient collections, the City budgets Ad Valorem Revenues at 95% of the expected collections of $6,160,832 or $5,852,791.

 

Options:

  1. By a majority vote, the Commission may authorize the City Manager to execute and submit the Certification of Taxable Value at the maximum millage rate equal to the current year rolled back rate adjusted for growth totaling 4.8441 mills per $1,000, the Tax Increment Adjustment Worksheet and the Maximum Millage Levy Calculation Preliminary Disclosure for Fiscal Year 2009-10 to the Lake County Property Appraiser.  ($1,426,812,335 X .004844 = $6,911,621 X 95% $6,566,041)

 

  1. By a majority vote, the Commission may authorize the City Manager to execute and submit the Certification of Taxable Value at any such rate that does not exceed the maximum millage rate allowed of 4.8441 mills per $1,000, the Tax Increment Adjustment Worksheet and the Maximum Millage Levy Calculation Preliminary Disclosure for Fiscal Year 2009-10 to the Lake County Property Appraiser  (Net Revenue at 95% would need to be determined)

 

  1. By a majority vote, the Commission may authorize the City Manager to execute and submit the Certification of Taxable Value, reflecting the proposed operating millage rate of 4.3179 mills per $1,000, the Tax Increment Adjustment Worksheet and the Maximum Millage Levy Calculation Preliminary Disclosure for Fiscal Year 2009-10 to the Lake County Property Appraiser; ($1,426,812,335 X .0043179 = $6,160,832  X 95% = $5,852,791); or

 

4.   Any such alternative action as the Commission may deem appropriate

 

 

Fiscal Impact: 

Please see Analysis above.

 

Submission Date and Time:    7/24/2009 8:43 AM____

 

Department: ______________________

Prepared by:  ______________________                     

Attachments:         Yes____   No ______

Advertised:   ____Not Required ______                     

Dates:   __________________________                     

Attorney Review :       Yes___  No ____

                                                 

_________________________________           

Revised 6/10/04

 

Reviewed by: Dept. Head ________

 

Finance  Dept. __________JB______                                     

                              

Deputy C.M. ___________________                                                                         

Submitted by:

City Manager ___________________

 

Account No. _________________

 

Project No. ___________________

 

WF No. ______________________

 

Budget  ______________________

 

Available _____________________

 

RESOLUTION NO._______________

 

A RESOLUTION OF THE CITY OF LEESBURG, FLORIDA, AUTHORIZING THE CITY MANAGER TO EXECUTE AND SUBMIT THE CERTIFICATE OF TAXABLE VALUE FOR FISCAL YEAR 2009-10 TO THE LAKE COUNTY PROPERTY APPRAISER; AND PROVIDING AN EFFECTIVE DATE.

 

BE IT RESOLVED BY THE CITY COMMISSION OF THE CITY OF LEESBURG, FLORIDA:

 

            THAT the City Manager is hereby authorized to execute the “Certificate of Taxable Value for Fiscal Year 2009-10” and submit the same to the Lake County Property Appraiser.

 

             THAT this resolution shall become effective immediately.

 

PASSED AND ADOPTED by the City Commission of the City of Leesburg, Florida, at a regular meeting held the 27th day of July 2009.

 

 

 

                                                                            __________________________

                                                                             Mayor

 

ATTEST:

 

 

__________________________

City Clerk